Paid Family Leave claims processing tips

New York is setting a trend with new Paid Family Leave policy. New law could trigger states to follow their lead in the near future.

While most of us realize that change is a part of life, few of us can afford to sacrifice our paycheck when it happens.

To help ensure that New Yorkers do not find themselves in this situation, the state signed into law the nation’s strongest and most comprehensive Paid Family Leave (PFL) policy. Effective Jan. 1, 2018, the law provides residents with job-protected, paid leave to bond with a newborn, care for a loved one with a serious illness, or tend to family matters when a loved one is called to active military service.

The new law encompasses numerous leave types, eligibilities and durations, so processing a PFL claim can be confusing. To unmuddy the waters, let’s dive into the who, when, how and what regarding PFL.

Who is eligible?

Added to a company’s Disability Benefits Law (DBL) policy as a rider, Paid Family Leave was created for private-sector organizations with at least one employee who works in New York State at least 30 days of the year. Public companies may opt to provide coverage as well, but it is not required.

To be eligible for PFL, applicants must be employed by a covered employer at the time they apply.

Employees with a regular work schedule of 20 or more hours per week are eligible after 26 consecutive weeks of employment. This includes sick or vacation time, but may not count other covered leaves.

Employees with a regular work schedule of fewer than 20 hours per week are eligible after 175 days worked, which do not need to be consecutive.

How it works

In 2018, both full- and part-time employees are eligible to take up to eight weeks of PFL and receive 50% of their average weekly wage (AWW). The weekly earnings under PFL are currently capped at $652.96, which is 50% of the New York State Average Weekly Wage (NYSAWW) of $1,305.92. (For details, visit www.ny.gov.)

New Yorkers stand to benefit even more in the years to come, as the state plans to increase PFL incrementally, reaching 12 weeks by 2021.

PFL benefits are funded through a small weekly payroll deduction. The deduction is a percentage of an employee’s weekly wage — up to the aforementioned cap.

To provide some perspective, the current payroll contribution is 0.126% of a New Yorker’s gross weekly earnings, capped at a total annual contribution of $85.56. For example, an employee earning $1,200 a week in 2018 would pay $1.51 per week. To calculate an employee’s weekly deduction, simply enter the required information at www.ny.gov/paid-family-leave-calculator.

A healthy dose of security

Not only will eligible applicants receive a portion of their wages while on leave, qualifying employees can rely on continued health insurance coverage while taking PFL. Employers are required by law to continue the existing health insurance benefits. If employees contribute to the cost of their health insurance, they are also required to continue paying their portion while on leave.

It is important to note that Paid Family Leave does notreplace disability benefits coverage. Disability benefits are meant to cover off-the-job personal illness or injury. PFL is designed to provide paid time off to care for family that need assistance.

In fact, some employees may be eligible for both PFL bonding and disability benefits for maternity at the same time, although they may not be taken simultaneously, according to the New York State Workers Compensation Board.

Leave categories

PFL is flexible and may occur in a variety of ways. The applicant has options when deciding how much time to take at any given time. While the law states that a 30 day leave notice is required, there are considerations for times when life surprises us.

There are four main PFL categories:

Continuous leave: The employee takes the entire 8 weeks of PFL without interruption.

Intermittent leave:The employee takes leave in increments as short as one day at a time.

Foreseeable event:The leave begins following a planned event such as a birth, adoption, surgery or military ceremony.

Non-foreseeable event:The leave is in response to an accident or an unexpected surgery.

PFL-worthy events

As mentioned earlier, an employee can request PFL for one of three reasons. The State of New York classifies these leaves as Bonding, Family Care and Military Exigency. Each type has its own eligibility terms and required documentation. If your company or agency does not have the required forms on hand, they are available at www.ny.gov. Employees requesting PFL are required to do so at least 30 days in advance, when possible, starting with Form PFL-1.

Bonding Leave— A parent may take PFL during the first 12 months following the birth, adoption or foster placement of a child. To start the application process, an employee will need to obtain the “Bond with a Newborn, Newly Adopted or Fostered Child” forms package.

From there, the employee would complete a “Request for Family Leave” (Form PFL-1) and submit it to his or her employer, who will complete the employer section and then return it to the employee. A PFL-1 is required for all three types of leave. Also required is the “Bonding Certification” (Form PFL-2). The employee must complete and submit both forms, along with any supporting documentation (e.g., birth certificate, adoption certificate, etc.), to the employer’s insurance carrier.

Family Care Leave— New Yorkers have the right to take time off to care for a loved one with a serious health condition. This individual could be a spouse or domestic partner, child or stepchild, as well as a parent, stepparent, parent-in-law, grandparent or grandchild.

After obtaining a “Care for a Family Member with Serious Health Condition” forms package, the employee must submit a completed PFL-1 to their employer, who will complete it and return it to the employee. Additionally, the employee’s family member (the care recipient), or their authorized representative, is required to complete a “Release of Personal Health Information Under the Paid Family Leave Law” (Form PFL-3). Upon completing the release, the individual will submit it to his or her health care provider.

The second form the employee is required to complete is the “Health Care Provider Certification” (Form PFL-4). Upon completion, this form will go to the employee’s health care provider for review, then to the care recipient and ultimately back to the employee. The employee must submit the PFL-4, along with his or her completed PFL-1, and PFL-3, to his or her employer’s insurance carrier.

Military Exigency Leave — If an employee’s spouse, domestic partner, child or parent is deployed abroad or has been notified of an impending deployment, the employee can take PFL to assist or support the military member and his or her family. Examples include making financial and/or legal arrangements on the military member’s behalf, attending military-related ceremonies for the deployed individual and tending to urgent childcare needs created by the family member’s deployment.

To begin the process, the employee must obtain the “Assist Families in Connection with a Military Deployment” forms package. Next, the employee will need to complete a PFL-1 and submit the form to his or her employer. The employee must then complete the “Military Qualifying Event” (Form PFL-5), attaching any supporting documentation (e.g., covered active duty orders, letter from the military unit confirming deployment, etc.). The employee will then submit his or her employer-approved PFL-1 and completed PFL-5 to the employer’s insurance carrier.

Employer obligations

For employers, when it comes to PFL claims, compliance is key. Here are a few important obligations:

New York employers are required to complete and return a submitted PFL-1 within three business days of receiving it.

If an employer provides health care, the employer must maintain coverage while the employee is out on leave.

As mentioned earlier, employers must provide the same or a similar job upon the employee’s return from leave.

While honoring these obligations are the law, doing so can be challenging for business owners, especially in the case of an intermittent leave. This new coverage will ramp up over the next four years, rates and benefit details are subject to changes by the New York Department of Financial Services (NYDFS).

It is critical to stay in-the-know about this new and developing coverage. Employers can look to their local insurance professionals for help navigating the ins and outs of this groundbreaking law, starting with filling out an employee census to determine their related premiums.